Consumers can switch provider without penalty

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When planning the monthly budget, phone and broadband packages take up a substantial chunk these days, so when a provider suddenly announces a mid-contract price hike it can comes as a shock.

Often within the small print is a clause that customers are 'tied in' and will have to pay the remaining contract off before being able to switch to another provider.

Well, this could be a thing of the past, thanks to new guidelines set out by Ofcom following a review into the fairness of contract price terms.

From today, if a provider wishes to increase the costs of its broadband, landline and mobile phone subscription, customers should be given at least one month's notice of the increase and be allowed to exit the contract without penalty - meaning customers can switch providers without being charged.

Putting an end to hidden extras and small print, it also states that any changes to terms, pricing or otherwise, must be communicated clearly and transparently.

This will be welcome news to both individuals and small businesses who might have been lumbered with mid-contract price hikes, and it covers all telecom operators offering landline, broadband and mobile phone contracts.

Claudio Pollack, Ofcom's consumer group director said: "We have reached an important milestone in our work to ensure consumers and small businesses have better protection against unexpected price increases.

"Additionally, our new guide highlights important factors customers might want to consider before entering into a new contract to help them understand exactly what they are signing up to."